Different times require a new script
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“I have been rehearsing the arguments that from the backbone of ‘The Next Global Stage’ for more than two decades.” K. Ohmae writes, “My previous books, including ‘The Borderless World’ and ‘The Invisible Continent,’ examined many of the issues I am still exploring. Ideas, as I say, do not emerge in a state of perfection. In its genesis, ‘The Next Global Stage’ has been shaped by two forces. First, it bears witness to changing circumstances. Over the last two decades, the world has changed substantially. The economic, political, social, corporate, and personal rules that now apply bear scant relation to those applicable two decades ago. ‘Different times require a new script’…The second defining force behind ‘The Next Global Stage’ is that, over the last 20 years, I have witnessed some of the pioneers of the global economy firsthand. One of the first business leaders to be sympathetic to the notion of the truly global economy was the former CEO of Smith Kline Beecham, Henry Wendt. He saw cross-border alliances as a potential savior for the American pharmaceuticals industry and recognized that internationally based strategic alliances would become important, if not vital…Another early pioneer of the global economy was Walter Wriston, former chairman of Citibank. He saw globalization as an imperative not because of management or business theories, but because of technological breakthroughs. He prophesized that competition between banks would no longer be based on banking services, but on acquiring better technology. Effectively, the company able to make decisions quicker, often in the fraction of a nanosecond, would be the winner…Yet another business leader who was ahead of this time was Akio Morita, co-founder of Sony. The original business was called Tokyo Tsushin Kogyo or Totsuko (TTK). This name, even in its abbreviated form, was too difficult for Western markets. So Morita came up with the four-letter Sony to represent the quality of sound from his transistor radios. For Morita, the world was one big market, with few or no barriers. He thought big but was no megalomaniac. He famously advised companies to ‘Think Globally, Act Locally’…These visionaries shared many of my views about the then-emerging global economy, explained in such books as ‘Triad Power’ and ‘The Borderless World.’ I was fortunate enough to exchange views with all three of them and many others in the mid-1980s and beyond. However, discussions on the importance of the region-state proved more elusive and troublesome. I had to wait until the developments within China post-1998 to gain any sort of useful practical perspective on this issue…’The Next Global Stage’ makes sense of the world as I see it. Twenty years ago, globalization was a term, a theoretical concept. Now it is a reality. ‘The Next Global Stage’ is part of a process of understanding the new rules that apply in this new world – and often, there aren’t rules to adequately explain what we now experience on a daily basis. İt is not an endpoint, nor is it a beginning, but I hope it is an important step forward for companies and individuals, as well as regional and national leaders (from the Introduction).” In this context, Kenichi Ohmae divides this excellent study into three parts: I. THE STAGE: This part looks at some of the areas of explosive growth and identifies some of the characteristics of the global economy. It then looks back at the birth point of this new era. This part end with an examination of the failure of traditional economics – and economists – to make sense of the global economy. II. STAGE DIRECTIONS: In this part, Ohmae examines the major trends emerging on the global stage. He explores the development of the nation-state and the dynamics of what he calls region-state. He goes on to introduce the idea of platforms, such as the use of English, Windows, branding, and the U.S. dollar, as global means of communication, understanding, and commerce. Finally, he explores what parts of business have to change in line with the emerging economy. These include business systems and processes and products, people, and logistics. III. THE SCRIPT: In this part, he provides analysis of how these changes and trends will impact governments, corporations, and individuals. He looks at some of the regions that might be the economic dynamos shaping the world beyond the global stage. Finally, he revisit his book, ‘The Mind of the Strategist,’ and think through the need for changes in the frameworks used in developing corporate strategy on the global stage. As a final point, Ohmae says that “I hope this book helps you develop some feel for the new global economy, the coming shape of the geopolitical maps of the future, the key levers corporations can pull, and the dynamic business domains we can tap. Now it is your turn to climb up onto the global stage and perform (p.272).” I highly recommend this excellent study.
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New strategy frameworks for the new global stage
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Kenichi Ohmae is one of the world’s leading business and corporate strategist. Ohmae was senior partner at McKinsey & Company leading Japan and Asian Pacific operations and has written numerous bestselling books such as ‘The Mind of the Strategist’ and ‘The Borderless World’. This book was first published in March 2005 and consists of three parts, whereby each part consisting of 3-to-4 chapters. The Introduction explains that this book has been shaped by two forces: “First, it bears witness to changing circumstances… Different times require a new script… The second defining force … is that, over the last 20 years, I have witnessed some of the pioneers of the global economy firsthand.” The following Plot highlights that we now live in a truly networked and interdependent world, united by a global economy, and the author hopes with this book to provide a script to negotiate through the shifting plot lines. In the 3 chapters of Part I – The Stage – Ohmae looks at some of the areas of explosive growth (“the excessive capital in developed countries is looking for opportunities to breed”) and identifies some of the characteristics of the global economy (4 C’s – communications, capital, corporations, consumers). It then looks back at the birth point of this new era. “For me, 1985 is the annus domini, and the date system I like to use in a light-hearted way is AG and BG – after and before Gates”. The author refers to William Gates, who had established computer company Microsoft which launched the first version of the new computer operating system Windows in 1985. This part ends with an examination of the failure of traditional economics – and economists – to make sense of the global economy. “Let us repeat that the global economy is a reality – it’s not a theory…What we need now is a means of understanding, a theory to make sense of the global economy, stage directions for the global stage.” The four chapters in Part II – Stage Directions – examine the major trends emerging on the global stage. The opening section of Chapter 4 explores the development of the nation-state (“the most obsolete of these notions in the nation-state”) and the dynamics of the region-state, the most useful and potent means of economic organization in the global economy. “The ongoing development of the global economy will lead to an inevitable undermining of the nation-state in favor of the region.” In the fifth chapter Ohmae introduces the idea of platforms, such as the use of English, Windows, branding, and the U.S. dollar, as global means of communications, understanding, and commerce. “The challenge for all of those operating on the global stage is twofold: to understand the importance of platforms and to be able to utilize them as effectively and as early as possible.” Finally, I explore what parts of the business have to change in line with the emerging economy. These include business systems and processes, and products, people, and logistics. The 3 chapters in Part III – The Script - provide analysis of how the changes and trends will impact governments (“central governments will find that a lot of their power has gone”), corporations (“the emergent corporation will be homeless”) and individuals. Ohmae also looks at some of the regions that might be the economic dynamos shaping the world beyond the global stage. In the final chapter, the author revisits his 1975-book ‘The Mind of the Strategist’ and thinks through the need for changes in the frameworks we use in developing corporate strategy on the global stage. “the very definition of strategy using three C’s [company, competition, and customers] is no longer valid.” Ohmae introduces the Japanese phrase ‘kosoryoku’ [= something like “vision”, but it also has the notion of “concept” and “imagination”] for developing strategy. First, you describe the vision. Second, you spell out strategy. Third, you develop the business plan. He believes that the mental process for the new type of strategy development is a clear departure from the traditional business school type of teaching of strategy development and in order to develop this type of talent “we need to nurture future business leaders in the same way we develop world-class athletes and artists.” Yes, this is a very interesting book and highlights some of the main levers organizations can pull to tap into the global economy. It discusses some of the essential new rules that apply and provides readers with an important step forward to approach The Next Global Stage. Although Ohmae provides a decent framework, it still requires a lot of thought from companies and individuals. The author uses his traditional clear writing style to simplify extremely complex subjects into understandable text. I recommended this book to government officials, (global) business leaders and economists.
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Kosoryoku: Visionary Pragmatism
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Ohmae has written a number of books in recent years (notably The Mind of the Strategist, The Borderless World, and The Invisible Continent) in which he identifies and then analyzes what he believes will be significant trends in the near future. In this most recently published book, Ohmae examines many of the same issues while developing his ideas about them in much greater depth. He also explores other global issues whose importance seems to increase each day. For example, which "radically new rules" are now necessary to achieving success in politics, business, and career. Also, what are "potent new drivers" of growth and economic power and how can they most effectively be leveraged? Also, as the importance of nation states declines, what will replace them? What new strategies and leadership in "the borderless economy" are necessary? Ohmae is uniquely qualified to respond to these and other questions and, in this book, he does so with both insight and eloquence. As he explains in the Introduction, in its genesis, The Next Global stage has been shaped by two forces: "First, it bears witness to changing circumstances." Cleverly, he introduces the "script" metaphor and suggests that a new one is needed. "The second defining force behind [his book] is that., over the last 20 years, I have witnessed the pioneers of the new global economy firsthand." Indeed he has. Ohmae is now no means the first person to assert that there is a new global economy. Moreover, it made its appearance on the international "stage" years ago and that performance will continue for several more. To me, Ohmae's function is to help the global "audience" (i.e. his readers) realize that his book ":is part of [an on-going] process of understanding the new rules that ap[ply in this new world -- and often, there aren't rules to adequately explain what we now experience on a daily basis. [His book] is not an endpoint, nor is it a beginning, but I hope it is an important step forward for companies and individuals, as well as regional and national leaders." Ohmae carefully organizes his material within three separate but interrelated Parts: The World Tour, Opening Night, and The End of Economics. He introduces and then reiterates a number of key points. 1. Begin with a precise definition of mission. 2. Next, formulate an appropriate strategy. 3. Then develop a business plan that spells out the nature and extent of human and capital resource allocation. 4. Finally, develop a time frame for implementing that plan. Although Ohmae is obviously excited about the new opportunities created by the new global economy, he clearly recognizes (and identifies for his reader) the new problems and barriers which must be overcome to achieve success in that economy. To me, Ohmae has always seemed to be both a visionary and a pragmatist. His discussion of the Japanese phrase kosoryoku offers an excellent case in point. "The is what you need in developing strategy. Kosoryoku is something like 'vision," but it is also the notion of "concept" and "imagination"...It is the ability to come up with a vision that is necessary and, at the same time, implement it until it succeeds. It is a product of imagination based on realistic understanding of what the shape of the oncoming world is and, pragmatically, the areas of business that you can capture successfully because you have the means of realizing the vision." I strongly recommend this book to decision-makers who have a compelling need to understand the new global economy, the coming shape of the geopolitical maps of the future, the key levers that can "pull" their organizations through to eventual success, and the dynamic business business domains within which there is the greatest promise of that success. Once you have absorbed and digested the contents of his book, Ohmae concludes, "Now it is your turn to climb onto the the global stage and perform." Meanwhile, I offer to Ohmae both "Bravo!" and "Encore!"
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Accessibility over accuracy
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This book belongs to the storytelling genre within business literature, where accuracy and detail are sacrificed to fit into the intended pattern (some of the claimed facts about the Scandinavian/Baltic region were inaccurate). As such, it offers food for thought and serves as an entry point for further exploration into globalization rather than as a manual for policy making. The book is based on a few themes such as:
* Central government should offer greater autonomy to regions
* The mobility of corporations
* The emergence of a border-less global market The book starts promisingly but looses steam after a few chapters, with the same regional examples being used as references over and over again. I am happy that I did not stop reading because the book catches up again at the end, offering a couple of interesting future scenarios. I have read earlier works by Ohmae. Compared to these, this book does not have the same impact, yet offers an accessible account on global trends.
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Basic Book on Globalization
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This book is part reflection and part promotion. Author Kenichi Ohmae not only reflects on the course of globalization, but also takes the time to promote his distance-learning business and spotlight some of his friends. Ohmae, recently named advisor to Liaoning Province, particularly praises the province's former governor. Some of Ohmae's reflections are valuable bedrock information about globalization, but some seem curiously dated. He describes how surprised he was when he learned that people with whom he was dining had "Googled" him and could speak knowledgably about his life and work. He explains how capital moves unimpeded around the world, notes that ATMs and credit cards are important new mechanisms, and introduces a new business class whose members attended similar schools and all speak English. He teaches that regions should not cut themselves off from the flow of international capital and ideas, but instead should tap into it. Japan should be less protectionist and less centralized. And, yes, China is growing rapidly but treats workers horribly. We recommend this book to those who are new to globalization and need a prompt understanding of these fundamentals, plus ample background information and a bonus of more sophisticated interpretive insights (just not enough of them).
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